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The eulogies for George H.W. Bush keep rolling in, and a great American hero's life has been given proper tribute.
But there has also been a rewriting of history about the Bush presidency that needs to be cleared up. Liberals love Bush for the very tax increase betrayal that destroyed his presidency. This was the official end of the Reagan era. This was not just the political blunder of the half-century, it was a fiscal policy catastrophe.
Readers - Age - Idea - Story - History
Most readers under the age of 40 have no idea the real story of what happened. What the history books are writing is that Bush showed political "courage" in breaking his "Read my lips: No new taxes" pledge, and he was thrown out of office for doing the right thing.
Wrong. The quick story is that the Reagan expansion — in no small part due to the reduction of the highest tax rates from 70 percent to 28 percent — was shrinking deficit spending dramatically by the end of Ronald Reagan's presidency. The budget deficit had fallen in half, to 2.9 percent of GDP by 1988. It was headed to below 2 percent if Bush simply had done nothing.
Bush - Plan - Taxes - Dick - Darman
We will never know whether Bush always had a secret plan to raise taxes, but we do know that Dick Darman, Bush's budget director, persuaded Bush to agree to a budget deal with congressional Democrats to raise income taxes in exchange for spending cuts from Democrats.
But instead of cutting government spending, the 1990 budget deal became a license for Democrats to spend and spend. The budget deficit in 1991 was supposed to be $253 billion, and if Bush simply allowed the Gramm-Rudman automatic spending cuts to occur, the deficit would have fallen to below $100 billion. Instead, the deficit that year was $269 billion — with the tax...
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